Financial reality and the NHS

In the meantime, the NHS really will have to do “more for less”

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The idea that the NHS, rightly regarded as the crowning achievement of post-war Britain, can take lessons from PC World – a computer shop with an annoying jingle – has understandably raised eyebrows. But there is more to the assertion, made by the NHS’s Medical Director Sir Bruce Keogh, than initially meets the eye.

The point Sir Bruce makes is that “doing more for less” has always been a mantra in the private sector. It is at the heart of capitalist economics, in which businesses can never assume that the money will keep on flowing – so money itself has to be made to work harder.

The NHS budget has increased by around 4 per cent every year since 1948 – it has never had to worry about the bottom line in the same way. Now, it must. In the recent spending review, the Chancellor granted the health service a mere 0.1 per cent funding increase for 2015-16. This is the shape of things to come “for the foreseeable future”, Sir Bruce says.

Many will argue that the NHS is too important, and should be insulated from austerity at all costs. They may point to Germany and France, which each spend more than 11 per cent of GDP on health, compared with the UK’s 9.3 per cent, to argue we can still afford to top-up our NHS every year. For now, that point is moot. Even if the purse strings are loosened again one day, it will not be for many years yet. In the meantime, the NHS really will have to do “more for less”.

In the light of this, the debacle over the new 111 non-emergency phone line serves as a warning. A service that was rolled out too quickly, was poorly thought through and not sufficiently stress-tested, has been bad for patients. A public institution as important as the NHS is required to add a caveat to the old private sector mantra: “Do more for less – safely.”